One striking form of plasticity in the adult brain is the ongoing process of neurogenesis in discrete brain regions of almost all mammals examined to date, including humans. In the adult hippocampus, new neurons arising from resident neural stem cells play important roles in many adaptive behaviors, including learning, memory, homeostatic stress responses and mood regulation. Accumulating evidence also suggests that adult neurogenesis is involved or altered in many pathological conditions, such as epilepsy, developmental psychiatric disorders and degenerative neurological diseases. Therefore, understanding the basic mechanisms of adult neurogenesis may provide clues regarding the etiology and pathology of these mental disorders, and potential novel therapies. While the field has made tremendous progress during past decades, there are major gaps in our understanding of adult neurogenesis that need to be fully addressed before we can harness the endogenous plasticity and regenerative capacity of the adult brain for functional enhancement or repair after injury or diseases. One fundamental question in stem cell biology is whether and how niche signals calibrate the number of functional progeny based on local tissue demands. As adult hippocampal neurogenesis occurs within a dynamic neuronal network, local circuit activity could serve as an effective readout of current tissue demands and provide a signal to fine tune the neurogenesis process. Our central hypothesis is that the neurotransmitter GABA is a dynamic niche factor that couples activation of the local circuitry to regulation of distinct stes of adult hippocampal neurogenesis. Previous studies have established a critical role for depolarizing GABA signaling in regulating development of post-mitotic newborn neurons during adult neurogenesis and GABA has recently been shown to affect activation of a specific population of quiescent neural stem cells. However, whether GABA regulates different types of quiescent neural stem cells and proliferative neural progeny is largely unknown and there are little data on the function of inhibitory GABA signaling during adult neurogenesis. Aided by new technologies for clonal analysis of individual quiescent neural stem cells and optogenetic manipulation of specific interneuron subtypes, we will investigate the niche source(s) of GABA and roles of local interneuron circuitry in regulating three critical steps of young adult mouse hippocampal neurogenesis in vivo, including activation and lineage choice of different quiescent neural stem cells, survival of proliferating progeny, and development of glutamatergic synaptic inputs as newborn neurons mature. Our proposed studies will address fundamental questions in adult neural stem cell biology and neurogenesis. Basic principles learned from these studies may impact the fields of stem cell and developmental biology, neural plasticity and regenerative medicine.